04.2 Risk management Coal exclusions Our new firm-wide exclusion policy is one of our key transition risk mitigation policies, annual revenue from thermal coal extraction, and companies where more than 30% of and it is an example of our commitment to tackling climate change by divesting from their electricity production is based on coal. This policy has become effective starting in 1 December 2021 for all existing funds for which AllianzGI acts as management company the single largest source of carbon emissions. We have a firm-wide exclusion policy that includes a dedicated thermal coal policy. and has been the default policy for all new funds and mandates after this date, subject to According to the International Energy Agency, thermal coal2-fired electricity authorisation of the relevant jurisdictions and completion of relevant documentation. generation is the single largest contributor to human-induced global temperature This new exclusion policy is a further example of AllianzGI’s commitment to tackling increase, accounting for about 30% of >1°C increase in global average annual surface climate change by divesting from the single largest source of carbon emissions. temperatures above the pre-industrial levels already observed.3 According to this AllianzGI started restricting investment in coal in its sustainable strategies in 2019. policy, AllianzGI refrains from investing in companies that derive more than 30% of their We apply even stricter criteria for our sustainable minimum exclusion (see link). 1. This Policy is applicable to mutual funds for which Allianz Global Investors is acting as management company. For institutional funds and mandates, application of the Policy including its implementation date is subject to the consent of the respective clients. 2. Thermal coal refers to the use of coal in power generation as well as the mining of thermal coal. It does not apply to metallurgical coal - coal utilized in industrial production process, e.g. making of steel, cement, iron ore or other heavy metals - as there are no commercially viable alternatives available at scale yet. 3. https://www.iea.org/reports/global-energy-co2-status-report-2019/emissions For more information see our Firm-wide Exclusion Policy on our website. For more information see AllianzGI Climate Policy Statement 22 AllianzGI TCFD Report 2021